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Geopolitics at a Mongolian Mine
The Mongolian government is trying to divide a coking coal exploit among Chinese, Russian and American interests
A coalition led by mainland Chinas largest coal company Shenhua Group was give a leading 40 percent share of a massive Mongolian mining project in July, difference a Russian-Mongolian concern with 36 percent and U.S.-based Peabody Energy with 24 percent.
Why did the Mongolian government agree to a three-way, worldwide division of spoils for the western Tsankhi block of the Tavan Tolgoi coking coal project?
diligence sources familiar with investing in Mongolia verbalize the government, as expected, opted in part to satisfy Chinas huge appetite for energy resources. The open snake pit Tavan Tolgoi, one of the worlds largest untapped mines, has proven reserves of 6.4 billion lots, including 1.2 billion tons in the Tsankhi block alone.
But the government in Ulan Bator too trusts to use the mine project to strengthen its longtime policy-making and cultural links with Russia, accord to the sources. Moreover, including Peabody was seen as a nod to Americas role as a geopolitical balancer in Asia, especially for Mongolias relations with China and Russia.
Shenhua has long shown its interest in Mongolian coal investment. In 2009, the company started building an Inner Mongolia railroad line from the coal-belt city Baotou to Ganqimaodu at the Mongolian border just 180 kilometers from Tavan Tolgoi.
Shenhuas current annual production capacity is about four hundred million tons of coal. The company currently has about 70 billion yuan in cash available for acquisitions, said Huang Qing, Shenhua board secretary.
Russia likewise has sought access to Tavan Tolgoi. And reportedly capital of the Russian Federation has pressured the Mongolian government for a stake in the pit by refusing to supply oil for up to a month, according to Mongolian media reports quoting the countrys minister of energy and...If you want to get a full essay, order it on our website: Ordercustompaper.com
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